H.R. 8, aka The American Taxpayer Relief Act, averted the “fiscal cliff” and made permanent the federal estate tax with an exemption of $5.12 million per individual and a tax rate of 40% for amounts over the exemption. But you might be wondering about the specifics.

Forbes.com published an article that provides some insight on what exactly H.R. 8 did to estate taxes.

Q: Exemption?
A: $5.12M, Indexed for Inflation
Without H.R. 8, on January 1 the estate tax exemption would have dropped from $5.12 million per individual to $1 million per individual, and the tax rate for amounts transferred over the exemption would have risen from 35% to 55% (60% in some cases). But H.R. 8 prevented any change from the 2012 exemption. It remains $5.12 million for individuals ($10.24 million for married couples).

Q: Is the Exemption Portable?
A: Yes
In other words, a surviving spouse can use a deceased spouse’s unused federal estate tax exemption without having to rely on trusts. A byproduct of this portability is that bypass trusts won’t be needed for most families, although there are still benefits to using bypass trusts (in protecting assets from creditors, in cases where the surviving spouse might remarry, because assets might appreciate in value, because bypass trusts avoid administrative pitfalls).

Q: Is the Exemption Indexed for Inflation?
A: Yes
An inflation adjustment “means that those people who thought they used all of their gift tax exemption in 2012 actually have more gift exemption in 2013,” writes Bryan Howard, a Tennessee estate planning attorney.

Q: Rate?
A: 40%
H.R. 8 increased the estate tax rate for amounts transferred over the estate tax exemption to 40%. (This is a 5% rise from the rate that was in effect for 2011 and 2012.)